For those whose Roundhay flat is held on a long lease, the message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to extend the lease.
Leasehold premises in Roundhay with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Regardless of whether you are a tenant or a freeholder in Roundhay,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Roundhay valuers.
Isaac owned a conversion apartment in Roundhay on the market with a lease of just over sixty years outstanding. Isaac informally approached his landlord being a well known local-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 per annum. No ground rent would be due on a lease extension were Isaac to invoke his statutory right. Isaac obtained expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
In 2009 we were contacted by Mr W Peterson who, having took over the lease of a recently refurbished apartment in Roundhay in November 2005. We are asked if we could approximate the price would be to prolong the lease by a further 90 years. Similar flats in Roundhay with an extended lease were in the region of £200,000. The average ground rent payable was £50 collected per annum. The lease came to a finish in 2103. Given that there were 78 years left we calculated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 not including costs.
Last Autumn we were approach by Mr and Mrs. C Wilson , who acquired a newly refurbished apartment in Roundhay in March 1999. We are asked if we could approximate the price would likely be for a 90 year lease extension. Comparative residencies in Roundhay with an extended lease were in the region of £267,600. The average amount of ground rent was £65 invoiced monthly. The lease termination date was on 2 April 2092. Considering the 67 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £14,300 and £16,400 plus fees.